The new train between Laos and China

With the high-speed line between Kunming and Vientiane, a larger project connecting the People's Republic and South-East Asia begins

By Lorenzo Riccardi, Managing Partner RsA Asia

In April 2023 there was the inauguration of the first high-speed passenger train between China and South-East Asia, connecting the city of Kunming, capital of China's Yunnan province, and Vientiane, capital of Laos. The journey takes about ten hours and covers 1,035 kilometres.

The railway is a project that is part of the Belt and Road Initiative, costing 6 billion dollars, and the operation started in December 2021 for cross-border freight transit only and in April 2023 for passenger transport. The high-speed network aims to promote the movement of people and goods between South China and South-East Asia, facilitating trade and logistics in the region.

This project has a historical value and follows the region's connection initiatives that in the past also saw European countries as protagonists. In fact, at the beginning of the 20th century, a railway was built linking the city of Yunnanfu, in the Chinese province of Yunnan, to Hanoi, mostly built by Italian companies, workers, and technicians.

The new Kunming-Vientiane railway will increase bilateral and regional trade and investment with new jobs in the area and the revival of the tourism sector, also thanks to the new flow of Chinese travellers. The World Bank estimates that the Laos gross domestic product will increase by 21% following the construction of the railway.

In the first four months of 2023, the ASEAN region was confirmed as Beijing's top trading partner with an interchange of $304.6 billion, including $185.2 billion in exports to ASEAN and $119.5 billion in imports to China. Compared to the same period last year, there was an increase in aggregate trade volume of 6 per cent and in exports from China to Southeast Asian countries of 15 per cent.

This is the first segment of a larger project that will connect Beijing with Singapore via Laos, Thailand, Malaysia and connect the capitals Vientiane, Bangkok, Kuala Lumpur and Singapore with 5,500 kilometres of high-speed network to promote the region's logistics, trade and tourism.